DTSA’s First Verdict “Fig”-ure: Jam’n to the Tune of $500,000

In little under a year after its enactment, a Federal Court jury in the Eastern District of Pennsylvania issued the first verdict under the Defend Trade Secrets Act in favor of the Plaintiff Dalmatia Import Group, Inc. The jury awarded Dalmatia $2.5 Million in total damages for all claims, with $500,000 attributed to its DTSA and Pennsylvania Uniform Trade Secrets Act claim. Just this week, Dalmatia filed a motion for judgement on the verdict, seeking treble damages for its related trademark and counterfeiting claims. If the court awards treble damages, total damages could exceed $5 Million.

Dalmatia brought its trade secret misappropriation claims against its distributor, FoodMatch, Inc., and manufacturer, Lancaster Fine Foods, Inc., for the theft of its proprietary recipe for fig spread. In 2015, Dalmatia ended its relationship with FoodMatch. FoodMatch and Lancaster then used Dalmatia’s recipe to sell the same product under FoodMatch’s own brand, Divina. The trademark and counterfeiting claims were based on the defendants’ sale of Dalmatia’s fig spread, which Dalmatia specifically rejected for inferior quality, and fig spread produced by Lancaster after Dalmatia instructed Lancaster to cease operations.

The parties litigated the case throughout 2016 in both New York and Pennsylvania. Dalmatia initiated this action in the Southern District of New York in February 2016. In June 2016, the court transferred the case to the Eastern District of Pennsylvania. Because Dalmatia filed the case prior to the enactment of the DTSA, the DTSA claim, and related verdict, was the result of an amendment.

Previously, TSW extensively covered the ground-breaking litigation brought pursuant to the DTSA and TSW will continue to provide coverage as some of these first DTSA cases reach verdicts. Stay tuned.